Effective asset management is one of the fundamental keys for increased business productivity and profits—yet a large number of small and medium-sized businesses employ only manual asset management tools, such as spreadsheets or even paper-based records. Those businesses forgo the benefits of automated asset registers, compromising on efficient asset management.
Spreadsheets might be an effective way to record assets, especially for small businesses with limited inventories, but are much less effective for managing them. But for rapidly expanding businesses especially, proper asset management is closely tied to profitability and cash flow. While an asset register (sometimes called an asset registry) consolidates asset information into a single platform, it also provides a holistic view of all tangible and intangible assets. Asset registers are crucial to staying compliant with rules and regulations, safety standards and tax compliances; without detailed asset records, chances are you’ll encounter issues in tracking important assets. An asset register typically tracks information including:
- Asset name and description
- AIN or barcodes
- Asset owner
- Acquisition and disposal or anticipated disposal dates
- Insurance and warranty
How to maintain an asset register?
An asset register integrates the functions of an asset tracker. Organizations routinely invest in asset acquisition, maintenance and disposal, but not necessarily in the tools to keep tabs on those assets or their status. Keeping up with every asset is important for smooth workflows and business operations. Manual asset registers may be maintained by accountants in some organizations, but today’s asset management tools mean the process can be handled at the departmental level. Access privileges can be selectively assigned so that departments can manage their own asset registers while meeting safety and confidentiality requirements.
To understand the importance of asset registers, we first need to analyze the steps involved in creating one:
- Analyze the capital value of your assets: To know the total current value of your assets, it is necessary to log their value, based on a minimum threshold. Depending on the size and demands of your business, assets above a certain price threshhold might be categorized as high-value and elevated in priority for maintenance and repair. You may also enter low-value assets like dusters, pens and whiteboards, particularly if you are managing a school or other facility where the total quantity is high, to better track daily cash flows. This division ensures you distinguish assets that are long-term investments from expendibles and daily-use items. Your expenses, investments and profits are well documented, streamlining your balance sheets.
- Auditing your assets: Auditing is useful for objectively verifying your assets and their monetary worth. Auditing helps develop transparency, and provides a holistic view of your assets. Through bi-yearly and yearly audits, you can determine whether particular assets are working to their full potential, and initiate their repair if needed. Asset registers are accurate if they are based on data gathered and verified through audits. Any faults and errors in data recording can be highlighted during the audits, improving accuracy. Without such asset-checking records, you will be unable to create a trustworthy, detailed asset register. Audits ensure an accurate count of your assets, and correct valuation of your investments. You can also verify that the asset tags or other identifiers match each asset’s registry entry.
- Choosing an asset management system: Compared to traditional, manual systems, automated means of asset management are fast and efficient. Be sure to select one, though, that allows you to perform all of the functions you expect, such as asset purchase, repair, check in and check outs, reports generation, and much more. Also confirm that your chosen system can easily create a detailed asset register. Another factor: since the asset register will be automated, you can manage assets present in different locations through a cloud-based account, and have access to your data at all times. If you have a large business, an automated asset register will allow you to categorize assets, such as high-end assets and inventory so that it’s easier for you to take actions on them by category.
Read more: 5 Major Steps to Execute an Effective Asset Management Plan
How can you leverage an asset register for improved productivity?
As businesses grow, the need to evaluate their assets increases due to their high capital value. An asset register is the cornerstone of strategic asset management since without complete asset data, you cannot keep your assets well-maintained. Here’s how an asset register improves your workflows:
1. Speedy maintenance
Physical assets depreciate over a period of time owing to ordinary wear and tear or excessive use, as well as because of external factors such as weather or vandalism. They need to be constantly monitored and repaired to avoid complete breakdown—replacing a broken asset is typically more expensive than maintaining it periodically. Proactive maintenance is crucial to sustaining your assets, and keeping your operations running smoothly. This also reduces maintenance costs, and expands the operational capacity of your asset.
An asset register comes into play here as it provides your business a platform to keep all critical asset-related information in one place, including information about its depreciation. For example, in construction, the depreciation rate of a tractor will be recorded along with its current value. So, you can know the actual worth of all your assets, and their expected useful life. You can group assets within the register, and schedule maintenance in groups when needed.
Read more: 5 Actionable Maintenance Management Practices to Lower Equipment Downtime
2. Reduced asset thefts
Workplace theft is common, and puts assets—and your operations—at serious risk. Asset theft is hard to detect or counter when the business fails to account for all its assets, and loses sight of a few. According to a recent report, theft costs businesses around $50 billion annually. With the help of an asset register, asset thefts can be prevented and minimized as your business will be able to maintain a complete record of all your assets. Also, you can maintain an audit trail and track your assets using QR codes or barcodes.
Access to asset registers can require heightened authorization, adding a layer of security. You can cross-check assets physically against the data entered in the cloud to verify asset count. If an asset is missing, then you can track its history and identify its custodian—this increases transparency and accuracy, while reducing the chances of unnecessary replacement.
3. Enhanced asset utilization
Businesses should always seek to maximize equipment utilization, but doing so requires the ability to retrieve all asset information, and identify the assets at their disposal. With a dedicated asset register, you can stay updated with your asset utilization numbers, and ensure that no asset is sitting idle. For example, a school administrator may need to issue a new monitor to the school’s computer lab, but is unsure of its availability. By consulting the asset register, however, they can verify the monitor’s availability and check it out to the lab. That saves the cost of procuring brand-new equipment, and efficiently allocates the existing equipment.
With an asset register, you get a consolidated view of all your assets, including asset location, maintenance, depreciation and disposal. So, if an asset is nearing the end of its lifecycle, you know it’s time to acquire a replacement in order to avoid disruption. A well-maintained register can optimize equipment use, to prolong its useful life and maximize its value.
4. Reduced business risks
Having a well-developed asset register not only helps you save costs in the present, but strategize better to manage your assets going forward. You can set up procedures and implement strategies for optimal asset use. One layer deeper, you can derive specific metrics from your asset register to make asset-related decisions, such as adding new IT equipment, replacing outdated equipment, or devising maintenance plans. At its core, a dedicated asset management solution deepens your control over your own assets, and helps you identify risks—this helps you lessen their impact on your operations.
Moreover, through cloud-based storage, you can backup your asset details easily, without having to fear losing them. This coupled with added security through authorized log-ins and automated data encryption guarantees enhanced security of your asset register. Thus, any risks associated with data loss or cyber attacks can be mitigated- protecting sensitive data and data tampering.
5. Improved team collaboration
An asset management solution that enables multiple teams to access the same data enhances team coordination, compared to multiple, possibly clashing record-keeping systems. This means different users can manage assets according to the business needs; for example, if you manage the IT department in your organization, you can manage IT assets and update the relevant section of the register. In this way, the administrative burden of managing all assets does not fall on one particular user or department, and all departments are responsible for handling their own assets. Likewise, users will stay aware of assets’ count and their utilization based on who has used a particular asset; this ensures accountability, and lets teams know what assets are available for use.
Team members will be able to add new assets when needed, even when business operations are spread across various locations. This makes it easier for businesses to handle large amounts of assets—especially when your business is expanding rapidly. Since actions can be taken on the asset register based on pre-defined user roles, it allows for greater customization and optimized asset use.
Read more: 6 ways asset management automation helps you achieve business KPIs
How are asset registers and asset management solutions related?
Asset management solutions help you achieve sustainability in data management and streamline both long-term and short-term planning. With the inevitable acquisition of new assets and frequent maintenance that may be required for older ones, the need to have an asset register that can manage new data increases. For greater efficiency, it is vital to have a dedicated platform–an asset management solution–that can enhance data accessibility, usability and visibility by making it easy to view, edit, and act on the information in your asset register.
EZOfficeInventory is a leading asset tracking software. It allows you to track, maintain, and report on inventory from anywhere, at any time. We offer a free 15-day trial – no credit card required!